Montana contractors are apparently feeling the squeeze from high - and rising - cement prices and a worsening nationwide cement shortage. "It’s not only the cost. It’s the availability. Some of our concrete producers are under allotments. They can’t get enough cement. There simply isn’t enough to meet demand," said Cary Hegreberg, director of the Montana Contractors Association.
Last May, 23 states suffered from short cement supplies. By early August, seven other states and the District of Columbia joined the list, said Ken Simonson, chief economist for the Associated General Contractors of America in Alexandria, Va. It’s a shortage that’s threatening to limit the nation’s building boom, Simonson said.
Last week, four Western governors took action by writing to US Commerce Secretary Carlos Gutierrez to ask for increases in cement imports from Mexico. Other rising costs are also pushing up prices for concrete and other construction supplies.
Many contractors have been able to pass along costs to customers, but at a certain point buyers balk. In some cases, public projects have been put out for rebids. Other projects have been scaled down or postponed, Simonson said.
Most of the cement for concrete made in western Montana comes from Ashgrove Cement Co. near Helena, Holcim Inc. near Three Forks and a Lafarge Corp. plant in Washington. Some cement, too, is imported from Canada and other sources.
The Holcim plant is working at capacity, said spokesman Tom Chizmadia from the company’s headquarters in Waltham, Mass. "There has always been a historic gap between supply and demand in the United States. That gap has been offset by imports," Chizmadia said.
"Last year was the first year we got rationed," said Dave Zinke, general manager of JTL Group. The ration system is pretty simple. Based on the previous year’s cement consumption, JTL receives a monthly allocation from its suppliers.